Saturday, December 17, 2011

Japan declares Fukushima plant stable, but is it?

Questions are raised about decommissioning the six damaged reactors

Japan Prime Minister Noda
Japan Prime Minister Yoshihiko Noda said Friday Dec 16 that the government and TEPCO had regained control of the damaged reactors at Fukushima located about 150 miles north of Tokyo.  In a televised speech to the nation, Noda said, "Today,we have reached a great milestone."

"The reactors are stable, which should resolve one big cause of concern for us all."

However, many nuclear engineering experts immediately raised questions about what the government means by "stable" and pointed out the makeshift cooling system in place now could be wiped out by another earthquake.

The New York Times reported that many of these experts said that Noda's declaration was "premature" because the melted fuel in three of the reactors might remain there for as long as a decade before it is removed for safe disposal.  Japan does not have a high level waste repository.

The statement about the stability of the reactors is based on the measurement of the temperatures inside reactors 1, 2 & 3 all of which are below 100 C, the boiling point of water.  TEPCO said Dec 15 that temperatures inside the reactor pressure vessels ranged from 38-69 C (100-150 F).

Many nuclear engineering experts contacted by the news media in Japan and the U.S. said that the strict definition of cold shutdown is for an intact reactor.  In summary, no one knows how to define it, in regulatory terms, for reactors as badly damaged as the units at Fukushima.

Several experts raised the question of whether the damaged fuel in the reactors might spontaneously go critical again, but others pointed out it isn't in the correct configuration to sustain fission. Also, there is uncertainty whether any of the melted fuel escaped from the reactors into the primary containment structures.  If that turns out to be the case, getting it out will be a more difficult task.

The Japan Atomic Energy Commission said Dec 16 that it could be 10 years before work can begin to retrieve the damaged fuel.  And some experts said that a 30 year decommissioning timetable might be optimistic.

Another factor pointing to a definition of stability is that there are no new airborne radiation releases though significant leaks of radioactive water still make the site a dangerous place to work.  

What Noda wants from his announcement

Nuclear crisis manager
Goshi Hoshono
The political motivations for the announcement appear to address several objectives. The first is to convince provincial government officials throughout Japan to agree to allow the restart of 46 shut down nuclear reactors which supply a large portion of the nation's electricity.

Japan is less than 50% self-sufficient in terms of food production which means it needs high value manufacturing exports to pay for food imports. The electricity provided by the reactors runs the nation's heavy industries and durable goods production. The nation's utilities cannot financially sustain long-term purchases of coal, LNG, and bunker grade oil to produce replacement power.

Second, public anger at TEPCO and the government for mishandling the crisis remains high which is why Noda, and his lead crisis manager Goshi Hoshono, emphasized that declaring the reactors in stable condition is a precursor for allowing some of the 80,000 people evacuated from a 13 mile ring around the plant to go home.

Jonathan Cobb, a spokesman for the World Nuclear Association, told Reuters Dec 16 he expects the evacuation zone to shrink at the government identifies areas that are safe for return of the area's residents.

These two objectives are joined at the hip since images of people returning to their homes in Fukushima province will be a powerful media message to the rest of the country.

Third, Noda wants to convince international trading partners such as Vietnam and Turkey, which are negotiating to buy nuclear reactors from Japan, that they can do so with confidence.  In the U.S. Toshiba is the main vendor for planned construction two new nuclear reactors at the South Texas Project.  The problem for Noda, and Japan's heavy industries, is that they can't expect other nations to buy Japanese nuclear reactors if Japan's utilities can't control them or keep them running at home.

What's missing from this picture?

Part of the Fukushima water
decontamination system
The problem for experts looking at the problem from the outside is that it is not easy to assess how long it will take and what it will cost to decommission all six reactors. Three of the units have heat deformed fuel inside the reactor pressure vessels.

Prime Minister Noda acknowledges the challenges ahead.  He said in his nationwide TV address, "The battle is not over."

Nuclear crisis manager Goshi Hoshona said cleanup of the site could take as long as three decades.

Experts looking at the problem say the immediate threat is that makeshift cooling systems could break down, leak, or worse if a new earthquake caused additional damage to reactor units 1-3.

Japanese robotics experts are working to design remote handling tools to enter the reactor pressure vessels to examine the damage and eventually to retrieve damaged fuel assemblies. Also, the plastic piping that supports the cooling system and the rapidly-built decontamination plant need to be replaced with more permanent metal pipes. Last week it was reported that 45 metric tonnes of radioactive water leaked from the plant.

The cost estimate of decommissioning the site keeps spiraling upwards.  The latest official numbers are in a range of $50-60 billion.  TEPCO is paying compensation of $13 billion to businesses and families affected by the evacuation order.  The government may intervene in the firm's crumbling finances to buy a major stake in it so that the utility will remain solvent enough to supply electricity from its working power generation plants.

Is the government's statement credible?

There is wide public distrust in Japan of the government and TEPCO. This is a major cultural shift for Japanese society. A signifciant concern is whether the food supply is safe.  The public does not understand radiation readings nor the safety limits set by the government which are much lower than U.S. standards.

Food products such as rice, beef, and tea leaves have been reported to have C-137 contamination which has a half-life of about 30 years. However, in some cases the readings have been within regulatory limits. The problem for the government is that any radiation reading sets off public protests.

The road ahead for Noda's government and his successors for at least the next two generations will be to continue to show progress on cleanup and insure that no new radiation is coming from the Fukushima site.  One positive sign of progress is a temporary shell has been completed covering reactor #1 which will help contain any future radiation releases.  Even so, achieving greater control of the site in the short-term could be a very tall order.

Update 12/19/11

Goshi Hoshono tells Bloomberg what he means by "Cold Shutdown."

“We understand that there is a difference between the cold shutdown state for a normal nuclear reactor and the state of cold shutdown that we have achieved at Fukushima Dai-Ichi,” Hosono told reporters in Tokyo. “The goal is to have nuclear fuel where it is kept in a cold state and to ensure that radioactive materials are not emitted. That is the whole point of the cooling system that we have in place.”

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Thursday, December 15, 2011

Westinghouse AP1000 advances in US & UK

Regulatory approvals for safety set the stage for reactor construction and operation licenses

A majority of the members of the U.S. Nuclear Regulatory Commission (NRC) have voted to certify the Westinghouse AP1000 nuclear reactor design.  A vote on the final rule is needed to complete the process.

In the U.K. the Office of Nuclear Regulation said, that with a few caveats, the agency is satisfied with the design and issued an interim acceptance of the reactor.

The agency added a list of conditions that needed to be met to gain final approval which are derived from a report released last October by chief nuclear safety official Mike Weightman.

In addition, the U.K. agency issued a similar interim approval for Areva's 1600 MW EPR which is expected to earn significant market share in that country.

AP1000 poised for construction

The Westinghouse 1,100 MW reactor is the plant of choice for two nuclear utilities in the U.S. Two will be built at Southern's Vogtle site in Georgia and two more are slated for Scana's V.C Summer site in South Carolina.  Both utilities have asked the NRC for expedited approval of the reactor design and their combined construction and operating licenses.

CEO's for both companies have said they expect the licenses this month or in early 2012.  The clock is ticking on their construction schedules and every month of delay by the NRC increases the costs of building the power stations.  All four reactors are scheduled to enter revenue service between 2016 and 2018.

AP1000 containment component in China
Whether their expectations will be met is open to question.  NRC Chairman Gregory Jaczko said in his comments on his vote to approve the design "companies must accept the risk of potential delays."

However, he also wrote, "The combination of passive safety, severe accident, and defense-in-depth features gives me confidence that the AP1000 design is sufficiently safe."

In the U.K. the AP1000 is the design of choice for reactors to be built by two German utilities - RWE and E.on - at Wylfa and Oldbury.  It is in competition for selection with Areva's 1,600 MW EPR by a consortium of GDF Suez and Iberdiola at Sellafield.  In all 12 new reactors are planned to be built in the U.K. by 2025.

A spokesman for the U.K. Office of Nuclear Regulation told wire services the interim approval "is an important milestone."  He expressed confidence that Westinghouse will be able to address its list of conditions for final approval.  While the agency didn't make the list public, the items in Weightman's report include 38 additional areas for further review. The topics include emergency response mechanisms, dealing with prolonged loss of off-site power, and risks associated with various types of natural disasters.

In a Dec 14 press statement, Westinghouse officials said they were happy with the interim approval as part of the Generic Design Assessment.  Mike Tynan, Westinghouse VP, said, "the remaining activity does not pose a substantial risk to final approvals being granted."

Financing construction

In the U.S. Southern has an $8.3 billion loan guarantee from the Department of Energy to build two reactors with an estimated price of $14 billion that includes balance of plant and new transmission and distribution infrastructure.  Scana's has not applied for a loan guarantee.

Georgia and South Carolina are regulated electricity markets and support CWIP - construction while in progress - which allows the utilities to apply for reimbursement of construction costs as the reactor is being built. This approach can save upwards of a billion dollars per project in interest costs.

Once the final NRC rule on design certification is approved, both utilities are likely to place orders for the reactors.  If they do they will be the first ones in more than 30 years.

In the U.K. the German utilities that are planning to build multiple reactors are under financial pressure since what was once a stable source of cash flow from fully depreciated reactors will be cut off by 2022 as the German government closes all 17 of its plants. So far the eight oldest reactors have stopped operations.  The German utilities have sued the government over these actions, but compensation, if any, could be years in the future.

Even with the favorable regulatory climate in the U.K., it is unlikely that Westinghouse would commit to the steep costs of completing the reactor safety certification process without a firm order from a utility.

Other risks

In the U.S. both Southern and Scana will have the benefit of using standardized designs and documented lessons learned from experience Westinghouse is gaining building four AP1000s in China.

On the other hand, legal challenges of the license by anti-nuclear groups could interrupt construction adding costly delays to completion.

The U.S. utilities want an early decision from the NRC, but it is a good bet that their legal departments are already preparing for these challenges.

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TerraPower Seeks Wisdom in China

Bill Gates went to Beijing, but he didn't ink a deal, yet 

billgatesTerraPower, the privately-held nuclear reactor development firm  funded by the Gates Foundation, got a lot of ink in the world press last week.  The reason was that Microsoft billionaire and its former CEO Bill Gates (right) held a high profile press conference during a visit to Beijing, China.

However, no deal was inked with the China National Nuclear Corporation (CNNC) nor were any side agreements reached for joint R&D.

The intense press coverage about an intriguing reactor design that just recently emerged from a major makeover in a supercomputer simulation was more about Bill Gates in China than anything else.

The Chinese said it themselves. The China Daily for December 8 wrote that Zhang Laiwu, vice-minister of science and technology said,

"When we cooperate with Gates, what we value so much is not Gates' money, but his social influence, his rallying power, and his innovation ability."

What is the TerraPower reactor?

The question is whether there is a real reactor design that could be built. TerraPower thinks so, but is quick to caution in a statement on its website that the firm is talking to multiple nations including Russia and India about development opportunities.

Last June a delegation of TerraPower executives went to India to explore ideas there. In November 2009 Gates visited Toshiba in Japan to discuss joint R&D efforts.

For a an in-depth look at TerraPower’s prospects, and a review of some of the top level technical challenges, go to ANS Nuclear Cafe where the story is online now.

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Tuesday, December 13, 2011

Areva suspends work on Idaho enrichment plant

The firm slashes investments globally in the wake of the Fukushima disaster last March

Areva CEO Luc Oursel
The Associated Press reports that Areva, the French state-owned nuclear giant, is making massive cuts in its global investment program including the Eagle Rock Enrichment Plant in Idaho.

Curtis Roberts, a spokesman for Areva in the U.S., told this blog in a telephone call early this morning that design work would continue on the plant, "but construction work will not proceed."

He promised updates as the U.S. office comes to grips with the details of Oursel's statement to investors in Paris which took place at 2 AM eastern time.

He added that Areva is continuing to seek capital to build the plant.

"It is strong on our radar screen in the U.S.  We have contracts in place for production."

But Roberts also cautioned that Areva has "no date in the future where we could commit capital to build the plant even though it remains a viable project."

These comments were echoed later in the day by a blog post at Areva's North American web site.

Areva losses drive decisions

Oursel said Areva posted financial losses of {e}1.6 billion in 2011. Factors which contributed to the losses include bad investments in uranium mines in Africa and uncontrolled cost overruns at a nuclear power plant under construction in Finland and another one in France.

In briefing slides distributed to the media, Oursel showed that demand for enriched uranium worldwide is expected drop by 2-3% in 2011 compared to previous estimates.

Capital spending slashed

In total, Areva hopes to reduce its new capital investment by a third to 7.7 billion euros. In recent years the firm has struggled to raise investment capital.

Oursel said Areva would cut its total investments by 34% to {E} 7.7 billion over the 2012-2016 period, down from {e}11.6 billion invested during 2007-2011.

Europe has been embroiled in a financial crisis over the fate of the euro.  Oursel's decision is likely driven by the reality there would be cutbacks for all French government spending due to the crisis, which includes rising interest rates for debt, and the general economic recession that grips the continent.

Areva is also facing political challenges as the Socialist and Green Parties are critical of French President Nicolas Sarkozy's strong commitment to nuclear energy. The elections are slated to take place next May.

Idaho plant was ready to break ground

Oursel's move to stop work in Idaho at the Eagle Rock plant abandons an effort which includes an NRC license gratned in October to build and operate the plant and a conditional commitment by the U.S. Department of Energy for a $2 billion loan guarantee.

The total cost of the plant is estimated to be between $2.5 and $3 billion.  Had construction gotten underway, the plant would have begun producing enriched uranium for commercial nuclear fuel in 2014.

The federal loan guarantee covers $2 billion of the costs. Oursel says that if the project is economically viable, investors will be found for the remaining $1 billion.

In October Areva postponed ground breaking to spring 2012. Its U.S. office assured the media that it planned to move ahead with the project saying that it was too late in the year to mobilize a contractor in the face of the oncoming harsh Idaho winter.

Economic development leaders in Idaho Falls were skeptical having long experience with that environment. However, they had little choice but to accept the firm's explanation.  And the combination of the NRC license and loan guarantee made the plant look like a sure thing from a financial perspective.

Had the project gone forward it would have created several thousand construction jobs and 700 permanent jobs. Plus, Areva was pursuing a strategy of asking some of its key suppliers to co-locate facilities at the plant site some 18 miles west of Idaho Falls, ID.

Critics of Oursel's decisions point out he is more of a bureaucrat in the French government than an entrepreneur and that he does not understand the competitive opening he is providing to other firms such as URENCO,  USEC and TENEX.

Demand for enriched uranium in 2013, for existing nuclear power plants in the U.S. is expected to be about 12 million SWU.  The Eagle Rock plant was expected to earn about a 25% market share, or 3 million SWU/year, once it came online.

Areva boasted at industry conferences that it had signed up 70% of the plant's capacity in future contracts.  The long-term contract price for SWU, according to Ux Consulting is $148.

That makes the U.S. market worth about $1.78 billion a year with a 25% market share, or 3 million SWU, worth $444 million.

The price of uranium has dropped holding steady this week at about $52/lb for short-term contracts of U3O8 according to Ux Consulting. That's down from a high in February 2011 of $69.75/lb.

Demand for reactors rising globally despite closures in Europe

Reuters reported that Oursel said that Areva is still the world's biggest manufacturer of nuclear reactors and that he "shrugged off predictions of a nuclear winter".  He said demand was still there for its new generation reactors, which meet international safety standards.

"Regarding the new reactors, some say that the nuclear market has stopped. I want to say it's quite the contrary," Oursel told investors.

The firm will cut 1,500 jobs in Germany which is closing its 17 nuclear power plants.  Work in that country reportedly represents 6% of total revenues. Another 1,200 jobs will be lost in France.

Investments in new nuclear reactors are rising in China, India, Vietnam, and the U.K.  The firm is building two  reactors in China and has signed a contract to build a fuel reprocessing facility. It is expected to break ground in 2012 in India to build two reactors. It has plans to supply up to four reactors to partner EDF for multiple sites in the U.K.

Efforts to break into the U.S. market have been disappointing with the latest setback being the apparent loss of the opportunity to build at Calvert Cliffs in Maryland,  A pending merger of Constellation, which owns the site, with Exelon will likely end that effort. Exelon CEO John Rowe has dismissed prospects for the project saying a merchant economic model isn't viable given the long time it takes to build a new reactor.

Even if the merger does not go through, Constellation walked away from negotiations with the U.S. Department of Energy for a loan guarantee saying the cost of the credit risk premium was too high.

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Monday, December 12, 2011

White House issues apology by Jaczko

Chief of Staff Bill Daley breaks White House silence over escalating conflicts about the NRC

The shouting may be over in the long simmering dispute that broke out into the open last Friday at the U.S. Nuclear Regulatory Commission.  NRC Chairman Gregory Jaczko has issued an apology via the White House to the other four commissioners who jointly signed a letter complaining about his management practices.

A hearing by the House Oversight Committee scheduled for Wednesday December 14 will not see the fireworks that were expected as a result of the heated accusations that were exchanged today between committee chair Darrell Issa (R-Calif) and Rep. Ed Markey (D-Mass) on the MSNBC TV network. Their verbal fireworks threatened to derail any effort to contain the conflict.

Now, it is more likely that the hearing will include acts of contrition and pledges for better communication among the five commissioners.  Skeptics think it won't last much longer than the late night news coverage, but stranger things have happened in DC.  The good news is there are no allegations of financial wrong doing and no got drunk and jumped in the reflecting pool with a stripper.

Daley said in his letter that he believes the sources of the conflict can be addressed and he emphasized that while this is taking place that there will be no compromise of safety at the nation's 104 nuclear reactors.

Rep. Issa is not convinced that an olive branch has been extended by Jaczko or the White House.  He said in a statement released late Monday evening that "the White House is in denial" about the serious nature of infighting at the NRC.

White House wakes up and smells the coffee

These late breaking events follow an action packed Monday of meetings in which Daley and other White House staff worked to stave off a major meltdown of the regulatory agency.

According to press reports about Daley's letter to Issa, Jaczko has issued a personal apology and will seek third party mediation to help work out the differences that have emerged between him and the other four commissioners.

"The chairman apologized for the distractions caused by the present tensions and has taken responsibility for improving communications among the commissioners," Daley wrote.

Daley also wrote, "We have concluded that while there are tensions and disagreements among the commissioners, these management differences have not impaired the commission's ability to fulfill its mission"

From that formal language it appears that the White House counsel is in the picture reminding the President what happens to the nation's electricity supply if the NRC is determined to be non compos mentis. Based on the letter the four commissioners sent on October 13, all five  have had plenty of reasons to be distracted even if they also contributed to the fray by responding to perceived as well as real provocation. Now, the White House says, it is time for the nonsense to stop.

A white dove flies over troubled waters

 Flame out over too much wind
The White House had little choice but to get Jaczko to make a peace offering while also backing him in the position.  Many who have rankled, with some justification, at Jaczko's erratic tenure at the NRC feel this may be a time when he might be forced to leave the agency or to step down as chairman. Neither is likely to happen as replacing him would be politically difficult.

But once his disputes went public, he became a liability, but not for the reasons that ordinarily come to mind. In terms of realist politics, Jaczko was given the job for one reason, and that was to bottle up the Yucca Mountain project by preventing the license application from ever getting a hearing.

In the world of political appointments in Washington, DC, when people get mission focused tasks like that, they are supposed to do their job, and then keep their head down on all other matters.

Jaczko became a liability because he disregarded this salient piece of advice getting into a high profile series of ego driven personality conflicts with the other commissioners.  Again, from the point of view of realist politics, it was an unwise series of moves that could mark the rest of his career because he blew up the one reason he was useful to the Obama White House.

Who's the real opponent of Yucca Mountain?

Jaczko at the White House
Sen. Harry Reid has long been tagged as the point man for opposition to Yucca Mountain. In point of fact, he was a very convenient point man too giving the Obama campaign in 2008 a made to order wedge issue to win Nevada electoral votes,

It was the President who appointed Jaczko to the NRC and the fact that he came from Reid's staff is simply the mechanics of DC politics.

While Jaczko had previously worked for anti-nuke arch druid Rep. Ed Markey, that probably didn't matter to the wonkish Obama White House which may have been more impressed with his Ph.D. in physics from a top university.

The president needs to win Nevada again in 2012, and he needs Yucca to remain dead dead dead.  But Jaczko made himself a target by pestering the other four commissioners over penny ante stuff like travel, staff assignments, and an unpleasant management style. Of course the iceberg that was 7/8ths under water was the dispute over the Yucca Mountain license.  You wouldn't know it from the newspaper headlines.

The White House got an apology from Jaczko  because he was no longer following the mandate of do one thing, do it well, and don't make waves on anything else.

The four commissioners shouldn't take the apology personally for the simple reason it isn't about them.  Jaczko's mea culpa is to the White House and Congress over forgetting why he got the job.

Jaczko is smart guy, but the train of events indicates that that he might have outsmarted himself.  It's a hard lesson to learn.  Maybe now the NRC can get back to work.

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